WeWork has offered to swap its 7.875% and 5% bonds due 2025 for new debt and stock as part of its debt restructuring plan. The terms of the exchange depend on whether bondholders agree to participate in a new debt financing for WeWork.

  • Bondholders who agree to purchase its new 15% first-lien pay-in-kind (PIK) bonds due 2027 can swap their existing notes for a mix of new 11% second-lien PIK bonds and stock, or a larger stock-only allocation. The new first-lien PIK notes will pay 7% in cash and 8% in-kind.
  • Those that do not buy the first and second lien PIK notes can get new 12% third-lien PIK bonds due 2027 and stock, or all stock.

As per Bloomberg, majority of the bondholders of its old notes have already agreed to the exchange. WeWork its trying to reduce total debt by ~$1.5bn. Both of its bonds due 2025 are trading at 50-54 cents on the dollar.

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